Wednesday, November 10, 2010

Polo Ralph Lauren Reports 2Q Earnings

Ralph Lauren today reported net income of $205 million, or $2.09 per diluted shared, from $178 million, or $1.75 per diluted share a year earlier. RL beat expectations of $1.71 with the $2.09. Revenue rose 11% to 1.5 billion compared to last year, this beat expectations of the estimated 1.48 billion. The increase in revenue is driven by higher global wholesale sales and growth in retail sales. Higher shipment volumes in the United States and Europe offset the lower wholesale revenue in Japan and the unfavorable effect of currency translation. Retail sales rose 17% to $659 million from $563 million the previous year. Rise in retail sales reflects the newly transitioned Asian operations. Operating expense reported at $1.1 million is up 9% from the prior year. A source of the growth is the costs associated with the new Asian operations. Looking ahead the company expects that as a result of higher than expected second quarter revenues the remainder of fiscal year 2011 will have an increase in revenue in the low double-digit percentage, this includes the foreign currency translation effect. Previously the company had expected mid to high single digit percentage rate. As a response to the higher then expected 2Q Earnings the stock rose 7.29% to $107.95

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